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The White House is looking into national security concerns over Chinese artificial intelligence app DeepSeek after its developer prompted a global tech sell-off.
The National Security Council is reviewing the AI app’s potential national security implications, White House press secretary Karoline Leavitt said during a press briefing, according to Axios. Leavitt added that President Donald Trump sees the AI startup’s newly released AI models as a “wake-up call” for AI developers in the U.S., but that “we’ll restore American dominance.”
Last week, Hangzhou-based AI startup DeepSeek introduced its first-generation, open-source reasoning models, DeepSeek-R1, that demonstrated comparable performance to OpenAI’s reasoning models.
The release prompted a global sell-off of tech stocks, with Nasdaq, Dow Jones Industrial Average, and S&P500 futures all falling Monday morning. Chipmaker Nvidia (NVDA+7.29%) saw its stock plummet 17%, losing close to $600 billion in value — the largest single-day market cap loss ever for a U.S. company.
Meanwhile, the mobile app for DeepSeek’s AI chatbot, also called DeepSeek, surged to the top of Apple’s (AAPL+3.88%) App Store, while its site experienced outages from an influx of new users. DeepSeek also announced “large-scale malicious attacks” on Monday, forcing it to temporarily limit registrations.
Investors were spooked by the Chinese startup, which released its DeepSeek-V3 model in December that it said cost just $5.6 million to train and develop on Nvidia’s reduced-capability H800 chips. Meanwhile, U.S. rivals such as OpenAI and Meta have touted spending tens of billions on Nvidia’s more powerful chips.
Leavitt also said the Biden administration “sat on its hands and allowed China to rapidly develop this AI program,” according to Axios.
During his final days in office, the former president introduced additional measures focused on curbing advanced chip exports to China. The new regulations reinforce and build upon previous U.S. export controls aimed at restricting China from certain semiconductors that can be used for AI and military development.
